Time’s Up

Tips for college grads who are now repaying student loans

For many recent college grads, it’s time to pay up. As The New York Times reports, grads who walked the stage in the spring — and took out federal student loans to do so — usually have a “no payment” grace period ranging from six to nine months. That means for anyone who graduated in May, it’s about time to start paying the piper.

Unless you’ve picked otherwise, the government has enrolled you in the fastest, least-expensive repayment plan (the 10-year plan). It can be quite the shock though, once those bills start rolling in. If you find yourself stretched thin on the 10-year plan, check out the Department of Education’s repayment estimator. The site will show you which alternative repayment plans you qualify for and what your monthly payment would be. The feds offer many different plans that lower payments by extending the life of the loan. As the rules vary by plan, use the estimator site before making any changes.

And if you haven’t been getting bills and you’re pretty sure you should be, check with your lender immediately. If you aren’t sure which lender you use, head over to the National Student Loan Data System, which will list all the pertinent information.

Bottom line: It is 100 percent on you to repay student loans, so don’t delay. Any missed payments can hurt your credit score, which will impact your ability to buy a house, a car, get credit cards, etc. Student lenders (federal ones, at least) also have the ability to garnish wages if you don’t pay them back. So, find a repayment plan that works best for you, and get to work.

Chris O'Shea

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